ACCT 204 CH 2 Multiple Choice

Comstock Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs. Estimated and actually total manufacturing overhead costs and machine hours follow: Total overhead cost Estimated = $100,000 Total overhead cost Actual = $110,250 Machine hours Estimated = $20,000 Machine hours Actual = $21,500 How much is over- or under applied overhead?

$5,250 under applied

Comstock Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs. Estimated and actually total manufacturing overhead costs and machine hours follow: Total overhead cost Estimated = $100,000 Total overhead cost Actual = $110,250 Machine hours Estimated = $20,000 Machine hours Actual = $21,500 What is the predetermined overhead rate per machine hour?

$5.00

Before disposing of its year-end manufacturing overhead balance, Delphi Corporation had the following amounts in Manufacturing Overhead and Cost of Goods Sold: Applied manufacturing overhead = $100,000 Actual manufacturing overhead = $90,000 Unadjusted cost of goods sold = $800,000 If Delphi closes the balance of its Manufacturing Overhead account directly to Cost of Goods Sold, how much is the adjusted cost of goods sold?

$790,000

Which of the following source documents serves as a subsidiary ledger for the Work in Process Inventory account?

Job cost sheet

The source document used to specify the quantity and unit costs of raw materials issued into production is called a

Materials requisition form

Actual manufacturing overhead costs are recorded

On the left (debit) side of the Manufacturing Overhead account

Why would a company use process costing rather than job order costing to compute product cost?

The company manufactures a product using a series of continuous processes that results in units that are virtually identical from one to the next.

Which of the following cost(s) is (are) recorded directly into the Work in Process Inventory account? a. Direct materials b. Indirect materials c. Direct labor d. Both a and c e. All of the above

d. Both a and c

Applied manufacturing overhead costs are recorded a. On the left (debit) side of the Work in Process Inventory account b. On the right (credit) side of the Work in Process Inventory account c. On the left (debit) side of the Manufacturing Overhead account d. On the right (credit) side of the Manufacturing Overhead account e. Both a and d

e. Both a and d

The Manufacturing Overhead account has a $10,000 debit balance that is closed directly to Cost of Goods Sold. Which of the following stateless is true? a. Actual manufacturing overhead was less than applied manufacturing overhead b. Actual manufacturing overhead was more than applied manufacturing overhead c. The entry to eliminate the balance in Manufacturing Overhead will decrease Cost of Goods Sold d. The entry to eliminate the balance in Manufacturing Overhead will increase Cost of Goods Sold e. Both a and c f. Both b and d

f. Both b and d